Bank stocks rally for second day, Japan tech sector climbs
Political risks flare up in India, Thailand
TOKYO - WORLD markets on Thursday cheered the latest efforts by policymakers to stave off a global recession, including the biggest Chinese interest rate cut in a decade.
The brightening mood came despite another raft of bad corporate and economic news.
China's economy slowed further in November, the nation's top planner said, a day after the country's central bank slashed lending rates by 108 basis points - its fourth interest rate cut since mid-September.
Japanese consumer electronics giant Panasonic slashed its net profit forecast for the current financial year by 90 per cent due to weak sales.
Norinchukin Bank, the de facto central bank for Japan's farm and fishery cooperatives, announced a US$10.5 billion (S$15.8 billion) capital hike to shore up its finances - the biggest yet by a Japanese bank during the financial crisis.
Automakers announced more layoffs to cope with the industry slump.
Mitsubishi Motors said it would cut 1,100 jobs in Japan while Subaru-maker Fuji Heavy Industries said it would axe 800 jobs.
Markets, however, overlooked the gloomy news and pinned hopes on steps by policymakers to revitalise the world economy in the face of the worst financial crisis since the Great Depression.
'Bold policy moves by China leaves us more confident that Chinese growth might rebound in the second half of 2009,' said NAB Capital strategist John Kyriakopoulos.
Stocks rose 1.95 per cent in Tokyo, 3.3 per cent in Seoul, 1.4 pe rcent in Sydney and Hong Kong and 1.05 per cent in Shanghai.
In Europe, shares gained 1.5 per cent in Paris, 0.8 in Frankfurt and 0.1 per cent in London at the open.
Investors were 'looking ahead rather than at the shaky ground below their feet,' said Kazuhiro Takahashi at Daiwa Securities SMBC in Tokyo.
The European Union unveiled a 200 billion euro (S$390 billion) stimulus package on Wednesday, a day after the US Federal Reserve said it would pump US$800 billion more into financial markets.
Share prices also got support from hopes of fresh steps by US president-elect Barack Obama to shore up the ailing US economy, dealers said.
They said the market welcomed Mr Obama's appointment of former Federal Reserve chairman Paul Volcker as the head of a new panel of advisers to steer the US economy back to health.
'He is a heavyweight. The appointment capped the impression that Obama has a strong economic team,' Mr Takahashi said.
Overnight on Wall Street shares managed to shake off a series of gloomy economic reports and extended a bargain-hunting rally amid signs that a global credit crunch is easing.
The Dow Jones Industrial Average climbed 2.91 per cent in thin trade ahead of Thursday's US Thanksgiving Day holiday, for a fourth straight gain that has added more than 1,000 points to the blue-chip index.
US data were not encouraging, suggesting the world's biggest economy was sliding into a very deep and lengthy recession.
US consumer spending dropped 1.0 per cent in October, the steepest fall since September 2001, while key durable goods orders plunged 6.2 per cent and weekly jobless claims rose to a fresh 16-year high.
China's interest rate cuts came a little over two weeks after Beijing announced a four-trillion-yuan (S$890 billion) spending package to lift the Chinese economy, which grew at its slowest pace in five years last quarter.
A top official said the Chinese economy worsened this month.
'In November, a number of economic indicators are showing accelerated decline,' said Zhang Ping, minister in charge of the National Development and Reform Commission.
India's stocks and commodity exchanges were closed due to coordinated attacks across the country's commercial capital Mumbai, officials said.
KUALA LUMPUR At closing on Thursday, the KLCI was at 869.98 up 13.61 points, or 1.6 per cent.
'Market sentiment improved with China's decision to cut interest rates and the strong performance on Wall Street overnight,' one dealer told Dow Jones Newswires.
HONG KONG Hong Kong share prices closed 1.4 per cent higher on Thursday, as earlier gains on China's interest rate cut were trimmed by profit taking, dealers said.
The benchmark Hang Seng Index was up 182.61 points to 13,552.06. Turnover was HK$50.23 billion (S$9.78 billion).
SHANGHAI Chinese shares closed up 1.05 per cent on Thursday after the central bank announced its biggest interest rate cut in a decade to boost weakening economic growth, dealers said.
The benchmark Shanghai Composite Index, which covers A and B shares, closed up 19.98 points at 1,917.86 on turnover of 84.0 billion yuan (S$18.3 billion).
The Shanghai A-share index added 19.98 points, or 1.05 per cent, to 1,917.86 on turnover of 83.6 billion yuan, while the Shenzhen A-share index rose 9.48 points, or 1.68 per cent, to 572.33 on turnover of 38.4 billion yuan.
TOKYO Japan's Nikkei stock index closed 1.95 per cent higher on Thursday, lifted by an overnight rally on Wall Street and continued efforts by countries to prevent a deep global recession.
The Nikkei rose 160.17 points to 8,373.39, mirroring sharp gains across Asia after China announced its biggest interest rate cut in a decade to tackle an economic slowdown. -- AFP, BERNAMA, THOMSON REUTERS
